"It's the economy, stupid," James Carville famously said during the 1992 campaign, when a young Bill Clinton was running against the other President Bush. The same could be said during this presidential campaign. The headlines are full of economic bad news -- mortgage foreclosures, the collapse of an investment bank, higher gas and food prices and lower home prices. Voters routinely list the economy as their chief concern, and consumer confidence has sunk to low levels.

Yet at the same time, the economic numbers are not so bad. A recession is defined as two quarters of contraction. But we haven't had one yet. The gross domestic product has grown, albeit only by 0.6 percent, in the last two quarters. As my U.S. News colleague James Pethokoukis blogged after the most recent numbers came in, "Dude, where's my recession?"

By any historic standard, our economic numbers are good, though possibly headed in a negative direction. April's unemployment was 5 percent -- a figure that once upon a time was considered full employment. The Consumer Price Index was up 3.9 percent, largely due to price rises in energy and food. "Core inflation" was 2.3 percent. Productivity was up 2.2 percent.

Those are numbers that would have been taken as a sign of very good times when I was growing up. Then, we had recessions every four or five years and bad bouts of inflation in the 1940s, 1950s and 1970s, and unemployment sometimes surged to 10 percent nationally and to 15 percent in industrial states like Michigan. In contrast, we've had only two mild recessions since 1983, with a third now possible but not yet in view.

In those 25 years, we have had low-inflation economic growth more than 90 percent of the time -- something never before achieved in American history. Alan Greenspan titled his memoir "The Age of Turbulence, but the story he tells is one of the amazing resilience of the American economy. Hit by one shock after another -- a stock market crash in 1987, currency meltdowns in Mexico in 1994 and in Asia in 1997, the collapse of Long-Term Capital Management in 1998, and the Sept. 11 attacks and the Enron collapse in 2001 -- our economy has adapted and kept growing.

In the America I grew up in, the political effects of economic issues were clear. Voters, most of whom had vivid memories of the Depression of the 1930s, tended to vote for Democrats when the economy sagged. Political scientists produced formulas for predicting elections that were based largely on macroeconomic indicators: If the economy was growing, the incumbent party's presidential candidate would win; if it was in recession, he'd lose. But those formulas don't work anymore. If they did, Al Gore would have been elected by a comfortable margin in 2000.

Today, few voters remember the 1930s; the median-age voter has lived all his adult life in a period when low inflation economic growth has become the norm. Voters take a good economy for granted and are enraged by any irritation. But who is to blame? The subprime mortgage crisis was brought about by policies encouraging home ownership supported by George W. Bush and members of Congress of both parties. Monetary policy is made by Federal Reserve Chairman Ben Bernanke, who has bipartisan support.

Polls suggest votes are not moving in response to local economic conditions. Recent polls in Michigan, the No. 1 state in unemployment, show John McCain running even with Barack Obama, even though George W. Bush lost the state by 3 percent in 2004. And Obama is running much stronger than John Kerry did in Great Plains and Rocky Mountain states with very low unemployment.

But then Obama is advocating fiscal and trade policies -- higher taxes on high earners, more protectionism -- which are the opposite of John F. Kennedy's and the same as Herbert Hoover's. Yes, the economy matters in politics, but not in the way it used to.

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